Following the launch of their combined effort in the derivatives valuations space in July, interdealer broker Icap and financial analytics vendor Fincad have added new functionality to their Fair Value Insight solution. The web-based derivatives valuation solution, which is built on Fincad’s analytics and Icap’s market data, now features the ability for users to directly upload market data and trades into the system.
According to the vendors, the new functionality allows users to upload their own curves as well as FX rate groups, spot rates and historical volatilities used to price FX options and FX option strategy trades. The ability to upload trade details directly into the system should provide significant time savings for users with large portfolios, says Bob Park, president and CEO of Fincad.
The solution overall aims to provide a low cost online derivatives valuation solution for those with restricted budgets as a result of the current economic climate. It has been pitched as a risk management tool for the measurement of derivative cash flows for liquidity and capital management. To this end it provides valuations for interest rate, foreign exchange and commodity derivatives and debt securities.
“With the current spotlight on financial reporting, our clients are faced with an increasing demand for solutions that provide accurate and automated visibility into derivatives valuations,” says Park. “We’re dedicated to continuously improving our solutions to meet these needs through innovative technology that offers fully transparent independent valuations, while saving time and resources.”
Since its launch, the vendors have achieved two public wins for the solution: Harness Liquid Macro Fund and Provident Risk Management. Harness selected Fincad Analytics to provide real time derivatives pricing and risk monitoring, whereas Provident is using the solution as the foundation for its clients’ credit risk management and market valuations for interest rate derivatives.
The valuations space is rather crowded, so any public wins are a bonus for a new player such as this. The solution has been aimed at the small to medium size end of the market and management consulting firm Provident Risk Management and boutique hedge fund Harness UK’s fund both fit this bill.
Work on enhancing the flexibility of the front end should assist the vendors in gaining yet more traction in the market, or so the theory goes. The next couple of months should demonstrate whether the upgrade pays dividends.
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